Has Oil Contango Spread to Shipyards?

DSME Bins LNG Carriers Order

South Korea’s Daewoo Shipbuilding & Marine Engineering (DSME) will build four very large crude carriers (VLCCs) instead of two LNG carriers for an unnamed Oceania-registered client, the shipbuilder said in a stock exchange filing.

DSME received the original order for the LNG carriers back in October 2014, with the contract valued at KRW 455.7 billion (USD 412.2m).

The new contract for four VLCCs is worth KRW 430.6 billion (USD 389.4m).

DSME did not provide any details regarding the specifications of the newly ordered crude carriers.

The switch might have been prompted by the recent trend among fuel traders to charter supertankers and store cheaper crude for future sale.

The current rates for VLCCs on a Persian Gulf-North Asia route are about USD 69,000/day, while the rates in the time charter market span between USD 33,500 and USD 37,500 per day.

World Maritime News Staff

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Posted on February 17, 2015 with tags , .

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